They placed their bets relatively early.  Looking back at Matt's posts I am convinced he created an honest bet to begin with.   The "technicality" he escpaed payment from (in his mind only) is so lame it can only be an afterthought.  He made an honest wager, was sure Pirate would pay and when it became clear he wouldn't rather than face the music he raised the cap racked up another 70K BTC in bets, and came up with his exist strategy.

If you look at his early posts he was selected in who he took bets from, requires some younger members to escrow their portion (why have someone escrow a bet you know you will lose).  That changed roughly 14 days ago when he raised the cap, and started accepted 1,000 BTC bets from Jr members.

That he would accept the label of scammer should he not hold up his end of the bargain, that is, that he understands that not holding up his end of the bargain would in fact make him a scammer and justifiably labeled as such by the community. It reads as reinforcing the seriousness of the bet as an enforceable agreement such that violating it would constitute scamming.

I wish it wasn't so, but I do believe that Matthew, at least in the beginning, believed that Pirate was going to pay people back and had he won, would have gleefully accepted any funds paid to him and pursued scammer tags for anyone who didn't pay him back. If he didn't believe this, he faked it *incredibly* well.

He was seeking easy money, not to improve society. Nor was he joking. Didn't look like a joke, didn't sound like a joke. Looks like a scam, was a scam. Not a joke.